Apple Fans Shrug Off Maps Fiasco, Lap Up iPhone 5

CNBC.com with Wires

Friday, 21 Sep 2012 | 9:54 AM ETCNBC.com

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Apple users complained about the inaccuracies of the Apple Maps — a new navigation app for the iPhone and iPad — but that did not stop them from standing in line for the latest smartphone from the company on Friday.

Hundreds of people lined up around the block at Apple's store on New York City's swanky Fifth Avenue.

Kadijah Perez, 26, a Bronx resident, had not heard about the map issues. She said she wanted to use the phone for navigation, adding, "Hopefully, they'll just fix it."

Further south in Annapolis, Maryland, customers settled in lawn chairs waiting for the Apple store in Westfield Annapolis Mall to open. A man walking by quipped: "I'm beginning to believe (Mitt) Romney. The economy is bad. People are starving."

Waiting in line for anything was a first for Annapolis local Robert Delarosa, 37, who skipped buying the iPhone 4 due to bad reviews but is now tired of his iPhone 3GS.

"I'm stuck with this old 3GS, a Flintstone phone," he said.

Consumers across major cities including Sydney, Hong Kong, Tokyo and Singapore, who were the first to get their hands on the much awaited iPhone 5, shrugged off the consumer electronics giant’s latest glitch.

The smartphone went on sale in the U.S. and Canada hours after its launch in Australia, Japan, Hong Kong, Singapore, Britain, France and Germany.

It will launch in 22 more countries a week later. The iPhone 5 is thinner, lighter, has a taller screen, faster processor, updated software and can work on faster "fourth generation" mobile networks.

In London, some shoppers had camped out for a week in a line that snaked around the block. In Hong Kong, the first customers were greeted by staff cheering, clapping, chanting "iPhone 5! iPhone 5!" and high-fiving them as they were escorted one-by-one through the front door.

"It looks like another strong opening day for Apple . They should sell more iPhone 5s than any prior model," said BTIG analyst Walt Piecyk.

Apple booked more than 2 million orders for the device in the first 24 hours, double the first-day sales of the previous iPhone, the 4S.

Some analysts expect Apple to sell up to 10 million iPhone 5 models in the remaining days of September. JP Morgan estimates the phone could provide a $3.2 billion boost to the U.S. economy in the fourth quarter—a boost almost equal to the whole economy of Fiji.

Apple's rival and component supplier, Samsung Electronics, moved to spoil the party, saying it plans to add the iPhone 5 to its existing patent lawsuits against Apple.

As Apple began delivering its coveted new phone, struggling competitor Research in Motion , which makes the BlackBerry, had to admit that it was once again having service problems in Europe, the Middle East and Africa.

Apple's Messy Maps Problem

The handset has become a hot seller despite initial lukewarm reviews and new map software that is glitch prone.

Apple Maps, introduced as a replacement to the popular Google Maps, is available on the new iOS 6 mobile software platform. The app has been criticized for containing a number of geographical inaccuracies and failing to yield search results correctly.

Twenty-three-year-old Aditya Kumar, a new owner of the iPhone 5 based in Singapore, who has been a frequent user of Google Maps, says the new mapping system is “frustrating,” but is confident that Apple will fix it soon.

Wozniak Goes to Australia for iPhone 5

Even Apple's co-found had to wait in line to buy his new Apple iPhone 5.

“They’ll fix it in the next upgrade, it’s just an app,” Kumar told CNBC, adding that he will continue to remain a loyal Apple customer.

Sydney resident Saptarshi Chatterjee, who waited for hours to pick up his new iPhone, said while Apple Maps, is not as “polished” as the Google equivalent, it is a “step in the right direction.”

“The flyover feature (which gives you an aerial view of places) on the new maps software is very cool indeed,” Chatterjee said. “Apple has the potential to make some innovative features and really hook people into using their own applications.”

Technology analyst Rob Enderle of the Enderle Group said complications arise with each new operating system and the disappointment over the new map application was not enough to come in the way of sales.

“This isn’t a critical problem and shouldn’t hurt sales near term. The demand is simply too high and the issue’s too small. … Apple will eventually make it right,” he said.

Manoj Menon, partner and managing director for Frost & Sullivan Asia Pacific, said, “I don’t think it will have a significant impact on the sales. Consumers pay more attention to the look and feel of the product.”

He added consumers should give Apple the benefit of the doubt, given that it is its first attempt at making a map product.

“This is not the best launch for this product, but it will get better as more people start using it,” he said.

In a statement, Apple said: “We launched this new map service knowing that it is a major initiative and we are just getting started with it. We are continuously improving it, and as Maps is a cloud-based solution, the more people use it, the better it will get.”

Apple Drama

In a sign of the intense demand, police in Osaka, Japan, were investigating the theft of nearly 200 iPhones 5s, including 116 from one shop alone, Kyodo News reported. In London, police sought help finding a man wanted in connection with the theft of 252 iPhone 5s from a shop in Wimbledon early Friday.

Some fans went to extremes to be among the first buyers by arriving at Apple's flagship stores day ahead of the release.

In downtown Sydney, Todd Foot, 24, showed up three days early to nab the coveted first spot. He spent about 18 hours a day in a folding chair, catching a few hours' sleep each night in a tent on the sidewalk.

iPhone 5 Sales Prompts Apple-Mania

Customers anxious to be among the first to get their hands on the new Apple iPhone 5, stand in long lines to buy their new smartphones.

Foot's dedication was largely a marketing stunt, however. He writes product reviews for a technology website that will give away the phone after Foot reviews it.

"I just want to get the phone so I can feel it, compare it and put it on our website," he said while slumped in his chair.

In Paris, the phone launch was accompanied by a workers' protest — a couple dozen former and current Apple employees demonstrated peacefully to demand better work benefits. Some decried what they called Apple's transformation from an offbeat company into a multinational powerhouse.

But the protesters — urged by a small labor union to demonstrate at Apple stores around France — were far outnumbered by lines of would-be buyers on the sidewalk outside the store near the city's gilded opera house.

Tokyo's glitzy downtown Ginza district not only had a long line in front of the Apple store, but another across the main intersection at Softbank, the first carrier in Japan to offer iPhones.

Hidetoshi Nakamura, a 25-year-old auto engineer, said he's an Apple fan because it's an innovator.

"I love Apple," he said, standing near the end of a two-block-long line, reading a book and listening to music on his iPod.